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Injunction Won’t Compound Award|of $1 Billion that Samsung Owes Apple

SAN JOSE, Calif. (CN) - Apple cannot permanently ban Samsung from selling Galaxy smartphones and tablets, a federal judge ruled, finding lack of irreparable harm.

Despite a $1 billion jury award that found Samsung had "slavishly copied" the iPhone and iPad to produce its products, U.S. District Judge Lucy Koh said Apple failed to explain how it had been damaged and why an injunction was necessary.

The ruling, filed late Monday, notes some of the reasoning that guided Koh, and the Federal Circuit on appeal, when Apply sought a preliminary injunction.

These findings established that Apple could not show irreparable harm from "the likely infringement of the D'677 or D'087 patents," Koh wrote.

"The court concluded that Apple had not explained how erosion of design distinctiveness actually caused any irreparable harm, and rejected Apple's theory that infringement diminished the value of Apple's brand, which could not be separated from its products," Koh wrote. "The court further found that though there was some evidence of loss of market share, Apple had not established that Samsung's infringement of Apple's design patents caused that loss. The court noted that the evidence regarding how consumers chose smartphones was ambiguous, and given that the D'677 and D'087 patents cover only part of the phone design, limited to the front face, even what evidence there was that design was important to choice did not create a strong link to infringement of these design patents." (Emphasis in original.)

Though Koh noted that Apple has continued to lose market share to Samsung since that ruling, she also found that Samsung has also discontinued most of the infringing products.

"Apple's evidence does not establish that any of Apple's three design patents covers a particular feature that actually drives consumer demand," she wrote.

The evidence is mixed as to the importance of design in consumer choice, the ruling states.

"But even if design was clearly a driving factor, it would not establish the required nexus," Koh wrote.

"Apple makes no attempt to prove that any more specific element of the iPhone's design, let alone one covered by one of Apple's design patents, actually drives consumer demand," she added. "The Federal Circuit made clear in Apple II that customer demand for a general feature of the type covered by a patent was not sufficient; Apple must instead show that consumers buy the infringing product specifically because it is equipped with the patented feature."

In this respect, Apple failed to meet its burden

"Apple cannot establish a causal nexus by showing an individual consumer's demand for glossiness, or for black color, as these qualities are not themselves patentable," Koh wrote.

Though the jury found that Samsung diluted Apple's trade dress, thus establishing irreparable harm for that claim, neither company sells the products forming the trade dress claim anymore, according to the ruling.


"The court finds that, in the absence of case law authorizing a trade dress dilution injunction where there are no diluting products still on the market, an injunction cannot be in the public interest," Koh wrote. "The potential for future disruption to consumers would be significantly greater if this court were to issue an injunction, and such disruption cannot be justified in the absence of clear authority."

In a small consolation prize to Apple, Koh released a second ruling that refused to give Samsung a new trial for alleged juror misconduct.

Impartiality concerns arose after jury foreman Velvin Hogan told reporters he had previously been sued by Samsung-affiliated Seagate, and that he countersued. The husband of a partner at Quinn Emanuel Urquhart & Sullivan - Samsung's legal team - had even represented Hogan in the case.

Koh found, however, that this development illustrates only that Samsung failed to exercise reasonable diligence during jury selection.

When asked in the selection process about any previous litigation entanglements, Hogan indicated that he had been involved in a case with a former partner, but did not mention Seagate. Koh did not ask for details, and Hogan said he did nothing wrong.

Samsung "had all the information it needed to uncover Mr. Hogan's lawsuit against Seagate - the fact of the bankruptcy and the fact that Mr. Hogan had a relationship with Seagate - on the day of jury selection, nearly four weeks before the verdict was reached," the judge wrote. "Samsung cannot use post-verdict statements unrelated to any potential bias to restart the clock on its obligation to investigate. What changed between Samsung's initial decision not to pursue questioning or investigation of Mr. Hogan, and Samsung's later decision to investigate was simple: the jury found against Samsung, and made a very large damages award. This is precisely the situation that courts have consistently found constitutes a waiver of the juror misconduct claim."

Even after Hogan told the court that he had once been employed by Seagate, "Samsung's counsel failed to ask any follow-up questions regarding that relationship," the ruling states.

"Samsung's counsel questioned Mr. Hogan only about his patents and his hobbies, and did not take the opportunity to delve into the nature of his relationship with Seagate," Koh added.

Hogan's post-verdict press interviews also do not justify Samsung's bid to dig into Hogan's dealings during jury deliberations.

"Mr. Hogan gave several post-verdict interviews in which he recounted the legal standards that were utilized during deliberations to enable the jury to reach a verdict," Koh wrote. "These statements, however, all pertain to what occurred during jury deliberations, or to the jurors' mental processes - evidence specifically barred by Rule 606(b). Samsung does not argue that Mr. Hogan introduced any outside knowledge specific to the facts of this case. Even if the standards related by Mr. Hogan were completely erroneous, those statements would still be barred by Federal Rule of Evidence."

Koh added: "The judicial system can ask no more of jurors, who are brought into the case through no initiative of their own and who devote their time as a matter of civic duty, than that they do their best to apply the law as they are instructed. Moreover, at the hearing on post-trial motions, Samsung repeatedly praised the jury, noting the care, precision, and consistency with which the jury calculated damages based on trial damages evidence. Samsung also praised the jury for ruling for Samsung on Apple's breach of contract and antitrust claims. Samsung cannot credibly claim that the jury's conduct was simultaneously worthy of such great praise and so biased as to warrant a new trial."

Samsung has already filed an appeal of the jury's verdict in the Federal Circuit. A second battle between the two companies - this time involving Samsung's claims that Apple copies its Galaxy line to produce the iPod Touch, iPhones and iPads - begins March 31, 2014.

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